Vol. 5 Num 1128 Thu. August 02, 2007  
Front Page

Business leaders critical of IMF's diktat

Business leaders have criticised the interference of the international agencies, particularly the International Monetary Fund (IMF) and their bid to influence economic management of the country.

Top leaders of business and financial sectors yesterday in a joint statement alleged that the agencies were trying to impose conditions and dictate terms in every trifle detail of economic management of a sovereign country.

They expressed their grave concern over the IMF's direction to increase energy prices. They said the IMF directed the government to make adjustments in domestic prices of natural gas, which, in their opinion, will be a suicidal decision for the economy.

It is known that an increase in gas price automatically leads to the increase of production costs as well as an increase in fertiliser price, which consequently influences the already soaring prices of essentials, the statement added.

In addition, the cost of doing business will also increase, which will have a direct impact on the economy and much needed employment opportunities for the common people.

"It is quite interesting to note that following meticulous IMF prescription Bangladesh has been experiencing double-digit inflation," the statement said.

The signatories to the statement are: Mahbubur Rahman, president of International Chamber of Commerce-Bangladesh (ICC-B), Mir Nasir Hossain, president of Federation of Bangladesh Chambers of Commerce and Industry (FBCCI), Latifur Rahman, president of Metropolitan Chamber of Commerce and Industry, Dhaka (MCCI), Hossain Khaled, president of The Dhaka Chamber of Commerce and Industry (DCCI), MA Latif, president of (in-charge) Chittagong Chamber of Commerce and Industry (CCCI), Masih Ul Karim, president of Foreign Investors' Chamber of Commerce and Industry (FICCI), Anwar-ul-Alam Chowdhury, president of Bangladesh Garment Manufacturers and Exporters Association (BGMEA), Md Fazlul Hoque, president of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), Muhammad A (Rumee) Ali, Vice-chairman of Bangladesh Association of Banks, Abdul Hai Sarker, president of Bangladesh Textile Mills Association (BTMA), Nizamuddin Ahmed, acting chairman of Bangladesh Insurance Association and Kamran T Rahman, president of Bangladesh Employers' Federation.

The statement said the recent letter of IMF, as reported in the newspapers, to the finance adviser directing further trade liberalisation for growth momentum and urging to strongly resist formation of a "Safeguard Body" is uncalled for and unwarranted.

"The IMF prescription regarding further trade liberalisation is not at all desirable as it could not prove to help in achieving the desired growth level and alleviate poverty," they said.

"The best examples are Malaysia, Thailand, Singapore, South Korea and the Philippines who have come out of Bretton Woods prescription and we all are aware of the achievements made by them," the statement added.

In comparison to other developing countries, Bangladesh--being an LDC--has substantially liberalised its economy at the cost of hardship of entrepreneurs and common people even though under World Trade Organisation (WTO) umbrella, Bangladesh could avail and follow more domestic support measures, it said.

The statement said during the past two decades or so, a number of Asian countries, through appropriate economic policy measures within the framework of WTO, have achieved remarkable progress transforming themselves from largely agrarian, underdeveloped economies into dynamic export powerhouses.

"The experience of these high-performing economies provide many useful lessons for countries like Bangladesh in identifying the right policies and strategies to adopt, while reversing or shunning what have proved to be wrong strategies," it said.

"The business community reiterates their earlier recommendations to effectively support local industries through fiscal and other means including 'Safeguard Measures', as done by other countries, to boost export and create a solid industrial base for long-term benefit of the country and to create employment opportunities," the statement said.

The business community strongly urged the government to come out of the vicious cycle of prescriptions of IMF and similar institutions and follow the already proven development strategies of other developing countries including our Asian neighbours, the statement added.